Tvl.Ss.Agencies vs. The Additional Chief Secretary

Held

The Court allowed the writ petition. It noted the submission of the learned Additional Government Pleader that the respondent was prepared to undertake a fresh exercise based on fresh documents to be placed by the petitioner, subject to the payment of the disputed tax amount. Placing on record this submission, the Court directed the petitioner to deposit 15% of the disputed tax amount within one week from the date of receipt of the order. Upon receipt of this deposit, the second respondent was directed to re-do the exercise without being influenced by the impugned order dated May 11, 2017. Consequently, the impugned order was set aside, and the writ petition was allowed. No costs were awarded. The ratio decidendi is that where the revenue agrees to re-examine a case based on fresh documents, subject to a partial deposit of the disputed tax, the High Court can direct such re-examination and set aside the original impugned order.

Facts

The petitioner, Tvl.S.S.Agencies, represented by its Proprietor, S.Mariappan, filed a writ petition challenging proceedings dated May 11, 2017, issued by the Commercial Tax Officer, Tenkasi (second respondent). These proceedings, passed under Section 27 of the Tamil Nadu Value Added Tax Act, 2006 (TNVAT Act), demanded a sum of Rs. 6,73,164/- towards tax and Rs. 3,36,582/- towards penalty for the tax period 2015-2016. The petitioner contended that the proceedings were passed without considering their reply and documents, and were based on an electronically generated mismatch report from the departmental website. The petitioner argued that they possessed all relevant documents to disprove the findings and requested a re-exercise of the assessment based on these documents.

Key Issues

1. Whether the impugned proceedings dated May 11, 2017, passed by the Commercial Tax Officer, Tenkasi, under Section 27 of the TNVAT Act, are liable to be quashed for failing to consider the petitioner's reply and documents and for being based on an electronically generated mismatch report? Petitioner's contentions: The petitioner argued that the second respondent failed to properly consider their reply and submitted documents as required by the TNVAT Act. They further contended that the revision notice, dated September 29, 2016, was erroneously issued based on an electronically generated mismatch report from the departmental website, which they had objected to and disproved. The petitioner emphasized that they had all necessary tax invoices in the prescribed format for availing Input Tax Credit and that their request for invoice-wise particulars for the alleged wrong claim of Input Tax Credit was wrongly negatived. They asserted that their documents were sufficient to disprove the respondent's conclusion and sought a direction for a fresh assessment based on their submitted documents. Revenue's contentions: The learned Additional Government Pleader for the respondents submitted that the second respondent was prepared to undertake a fresh exercise based on fresh documents to be placed by the petitioner, subject to the payment of the disputed tax amount.